Conor Lenihan (Dublin South West, Fianna Fail)

I will deal with the issues raised by Deputy Allen in the final part of my contribution.

The Government shares the concerns expressed about the increasingly difficult situation of the Palestinian people. Ireland has been a long-standing supporter of the rights of Palestinians. The Government has been consistently active in promoting a lasting and peaceful settlement of the Israeli-Palestinian conflict. I assure the House that we remain firmly convinced that the only route to a just and lasting settlement is through a negotiated, two-state solution. Unilateral action to change the situation on the ground is simply not a viable option. The Quartet roadmap continues to provide the principles and the parallel steps on which Israeli and Palestinian leaders must act if there is to be a settlement. On this basis, the EU and the Quartet have set out very clearly for the new Hamas Government the moves it must make if it is to engage with the international community. We understand fully the difficult transition Hamas now faces in government. We have asked that it renounce violence, recognise Israel's right to exist and respect agreements already reached by the Palestinian Authority with Israel.

If Hamas continues to refrain from violence and shows a willingness to move on these essential conditions, the Government will argue very strongly for an appropriate positive response from the European Union. So far, the response from Hamas has been very disappointing. It should listen to the consistently courageous advice of President Mahmoud Abbas.

However, the EU has not terminated its aid to the Palestinians. The EU has been the strongest supporter of the Palestinian people internationally. It is also the largest donor to Palestine — providing an average of €500 million annually to support Palestinian institutions, NGOs and civil society and for humanitarian assistance. The Council decided on 10 April to review this assistance against the Palestinian Government's commitment to the principles set out by the EU and the Quartet. The Commission has already this year provided more than €100 million in vital humanitarian aid, but since early April it has temporarily suspended direct payments to the Palestinian Government.

The EU is firmly committed to continuing necessary assistance to meet the basic needs of the Palestinian population. In the review under way, Ireland is arguing strongly for a flexible and wide-ranging definition of what constitutes this necessary assistance. We are particularly concerned about the health and education sectors. It is not reasonable to argue, however, that the EU should continue its capacity-building support for the Palestinian Government while it refuses to commit to the peace process. The reduction of international assistance has undoubtedly contributed to the hardship in the West Bank and Gaza. However, the Israeli decision to withhold the customs duties and taxes, which it collects on behalf of the Palestinian Authority and which amount to €50 million per month, has had a particularly negative effect.

It is important that the Palestinian people should not face further hardship as a result of the reluctance of their Government to respect the peace process. The Government welcomes the agreement reached by the Quartet yesterday to support a temporary international mechanism for the direct delivery of assistance to the Palestinian people. The EU will meet its responsibilities and is now taking the lead in the early establishment of the mechanism. Ireland will play a constructive role in this process. We believe it must include provision for the payment of salaries to public sector personnel providing vital services.

It is essential that the Israeli Government also now meets its responsibilities. It must take this opportunity to resume the transfers due to the Palestinians, through the international mechanism. The Government is determined to play its part in keeping alive the prospect of a just settlement for the Israeli and the Palestinian people. We will also maintain our close links with the Palestinians, and continue to provide much-needed assistance.

I repeat today the commitment I have already given that there will be no reduction this year in the assistance provided by the Government, which amounted to more than €4 million in 2005. Already this year, since the Palestinian elections, I have allocated €1.5 million to UNRWA and I hope to be in a position to make further allocations soon. I had originally hoped to be in a position to increase assistance to Palestine very substantially this year. I sincerely hope political developments will make this possible in the near future.

In response to Deputy Allen's question of earlier today, there was no vote in the European Council on this matter, which proceeded by way of consensus. It is important to remember the distinction between the Council and the Commission. The Commission of its own volition and right can suspend aid. It did so. The Commission can do that in its own right without interference from or reference to the Council. The Minister for Foreign Affairs, Deputy Dermot Ahern, pushed the Irish view very strongly. I totally reject any suggestion that we were guilty of inaction on this matter. We believe the widest possible definition of what constitutes humanitarian relief should be used. We are pushing this matter very vigorously at a European level so that the people of Palestine are not punished for the misdeeds of their Government.

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